The orders as to costs
11 The Accor parties seek their costs of the proceeding at first instance, including the cross-claim, and their costs of the appeal and the cross-appeals. The essence of the approach advanced by the Accor parties is that, having regard to the Full Court's reasons and the final orders to be made, they had succeeded at first instance and on appeal. The Accor parties submitted that costs should follow the event and the Court should be slow to apportion costs merely because not all of Accor's arguments "that were advanced in support of their position (both at trial and on appeal) were accepted". The Accor parties referred to cases such as Ruddock and Others v Vadarlis and Others (No 2) (2001) 115 FCR 229 at [11] and Firebird Global Master Fund II Ltd v Republic of Nauru (2015) 90 ALJR 270; (2015) 327 ALR 192; [2015] HCA 43 at [6] per French CJ, Kiefel, Nettle and Gordon JJ.
12 By contrast, the respondents submitted that an apportionment of costs or a reduction was appropriate, having regard to the fact that the Accor parties failed or did not succeed on a number of issues, both at first instance and on appeal. As to the proceeding at first instance, they put forward two alternatives as to the appropriate orders. The first is that Liv and Ms Bradnam pay 40% of Accor's costs of the proceeding, including the cross-claim, and Accor pay Ms Patalano her costs of the proceeding. The second is that Accor pay 80% of Liv's costs of the misleading or deceptive conduct claim in the proceeding, and Liv pay 60% of Accor's costs of the trade mark infringement claims and the cross-claim in the proceeding; Accor pay Ms Patalano's costs of the misleading or deceptive conduct claim in the proceeding and the trade mark infringement claims; and Accor pay Ms Patalano's costs of the misleading or deceptive conduct claim in the proceeding, and Ms Bradnam pay 60% of Accor's costs of the trade mark infringement claims and the cross-claim in the proceeding. As to the appeal and cross-appeal, the respondents submitted that the appropriate order is that Liv and Ms Bradnam pay 50% of Accor's costs of the appeal and all of Accor's costs of the cross-appeal. The respondents referred to Bowen Investments Pty Ltd v Tabcorp Holdings Ltd (No 2) [2008] FCAFC 107; Howards Storage World Pty Ltd v Haviv Holdings Pty Ltd and Another (2010) 182 FCR 84 at [17] and other authorities.
13 The matters which the respondents relied on in support of their proposed orders as to the proceeding at first instance were as follows:
The Accor parties had only minor partial success against Liv in relation to their misleading or deceptive conduct claim and failed in that case as against Ms Patalano and Ms Bradnam. There was no appeal against that aspect of Accor's case.
Although the Accor parties have been substantially successful in the trade mark infringement case on appeal, they should be required to bear their own costs of "the numerous allegations and findings of fact sought against the respondents which were found to have failed". The respondents submitted that the Accor parties relied on 15 examples of first use of the trade marks and were ultimately successful on only one. It is appropriate for us to note at this point that the Court's findings related to the realtor advertisement of 17 December 2015 (at [200]-[233]) and, in the circumstances, it was not necessary for the Court to consider "the various contentions concerning the remaining examples of prior use by reference to the other nominated advertisements" (at [233]). The respondents submitted that the primary judge was asked to consider 49 "examples" of infringement and the allegations made good were limited to those set out in the Court's reasons (at [328]).
14 The matters which the respondents relied on in support of their proposed orders as to the appeal and cross-appeals are as follows:
(1) As to ownership and first user, the Accor parties were unsuccessful as to the following arguments:
(a) authorship was sufficient to establish ownership;
(b) the respondents' good faith defence was not available for leasing, letting and agency services as the Accor parties were first to use the trade mark for other services (commercial real estate agency services);
(c) many advertisements made good their claim to first use, but the Accor parties only succeeded on one.
(2) As to cancellation or amendment of the registered trade marks, the Accor parties unsuccessfully challenged the primary judge's division of services, asserting overlap in particular.
(3) As to infringement, the Accor parties unsuccessfully sought to challenge numerous findings that the respondents had not infringed the trade marks or had only infringed in respect of certain services. The appellants referred to paragraphs 6(a), (b) and (c) and 9(a) and (b) of the notice of appeal.
15 We do not propose to discuss the many authorities of this Court which have considered the circumstances in which costs will be apportioned or reduced because of success or failure on particular issues in a proceeding. It is sufficient to refer to Les Laboratoires Servier v Apotex Pty Ltd [2016] FCAFC 27 (at [302]); (2016) 117 IPR 415; Hockey v Fairfax Media Publications Pty Limited (No 2) (2015) 237 FCR 127 (at [122]); and Basetec Services Pty Ltd v Leighton Contractors Pty Ltd (No 8) [2017] FCA 258 (at [92]). The principles are well-known.
16 We are of the opinion that Ms Patalano should not be immune from an order for costs and, in fact, we are of the opinion that the order for costs against her should be the same as the order for costs against Liv and Ms Bradnam. It is true that she was not held guilty of any trade mark infringements (it appears that no allegation was made against her) or of misleading or deceptive conduct. Nevertheless, she was a party represented by the same solicitors and counsel as represented the company of which she was the guiding mind and hand. More importantly, she played an active part in the proceeding and she aligned herself with Liv's defence and brought her own cross-claim. For example, she sought a declaration that neither she nor Liv had infringed the trade marks and she sought rectification of the register of trade marks (see Appeal Book Part A tab 20 page 133). She played a similar role on the appeal. We have already referred to the cross-appeal she filed and the notice of contention she filed jointly with Liv.
17 As to the costs of the proceeding at first instance, the Accor parties have been substantially successful. However, there are two matters which are sufficiently significant in our view that they must be taken into account on the issue of costs. They are Accor's substantial lack of success in its misleading or deceptive conduct claim and its lack of success in relation to alleged instances of infringement. No doubt there are other failed submissions or allegations of fact, but we do not think that any of these are sufficient to weigh in the balance. It is not uncommon for there to be a failed submission or allegation of fact in any case and a practical and realistic approach must be adopted in determining when such failures are taken into account on the question of costs. In any event, the Court has assessed the matter and we think the two matters we have identified are sufficiently significant to be taken into account.
18 We think that this is an appropriate case for a reduction in the costs otherwise payable, rather than a different order in relation to different issues. This was the approach of the primary judge, albeit on different premises, and we agree that this approach is appropriate (Accor Australia & New Zealand Hospitality Pty Ltd v Liv Pty Ltd [2015] FCA 746 at [13]).
19 Having regard to the two matters which we have identified, we think a reduction in the costs of the Accor parties of the proceeding at first instance of 35% is appropriate.
20 As to the costs of the appeal and the cross-appeals, the Accor parties have been almost entirely successful. We are of the opinion that there should be a small reduction to reflect the lack of success of the Accor parties on some allegations of infringement. We think a reduction of 10% is appropriate in relation to the appeal. We do not think the other matters identified by the respondents warrant a reduction.